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Following remarks at the U.S. Chamber of Commerce, U.S. Ambassador to Panama Barbara J. Stephenson spoke with DipNote's Luke Forgerson about the U.S.-Panamanian relationship and Secretary Rice's upcoming trip to the country.QUESTION: Ambassador Stephenson, good morning and thank you so much for joining us today. I just wanted to start out by asking you, could you speak to the U.S.-Panamanian relationship?

AMBASSADOR STEPHENSON: You know, it’s the best that our relationship has ever been, and it’s – I got to say that – I had the pleasure of saying that to President Bush in the Oval Office when President Torrijos was here in mid-September for his fifth visit with President Bush, which is really impressive. I mean, Panama is a country of under 4 million people, and yet they’ve had five meetings with President Bush and we’re expecting Secretary Rice down next week.

It’s a close relationship. I mean, we have a long and shared history. Sometimes that’s been full of passion, but we have, I think, channeled that history into a very strong bilateral relationship. It’s the strongest it’s ever been – we like to say that – and there’s a commitment among senior Panamanian officials to try to, as we’ve put it, catapult the relationship to the next level.

QUESTION: Thank you. You mentioned the Secretary is going to be traveling there. Could you speak a little bit to her visit?

AMBASSADOR STEPHENSON: She’s coming as part of the Pathways to Prosperity ministerial meeting. This is the first meeting at ministers level since the Pathways to Prosperity initiative was launched September 24th in New York by President Bush. And the idea behind the Pathways initiative is to harness the benefits of free trade to be sure that they deliver opportunity for all of our citizens, with a real understanding on our part that opportunity, the opportunity that we have in North America, is a key part of what makes us attractive to our Latin American partners. And as part of that, the Secretary is going to sign a bilateral agreement while she’s in Panama with Foreign Minister and First Vice President Samuel Lewis Navarro to expand English language training so that an increasing number of Panamanians will choose U.S. universities for their university training so that the ties between us will remain strong in the decades to come.

QUESTION: That’s fantastic. One very important component of that relationship is trade. Could you speak to the trade agreement between the United States and Panama?

AMBASSADAOR STEPHENSON: Yes. Both sides have signed the free trade agreement, and Panama has gone through – it’s gone through their assembly, so it’s awaiting approval by our Congress. And we hope that comes as soon as possible because, in a nutshell, this agreement is good for the U.S., it’s good for Panama, and it’s good for our relationship. The U.S. sells Panama a lot more than Panama sells to us; and what Panama sells to us already comes in duty free under the Caribbean Basin Initiative, but what the U.S. sells to Panama comes in with a tariff. And as a native Floridian, my home state really stands to benefit from tariff reductions because, particularly with the downturn in the construction industry in my home state, Panama still has a very robust construction industry, and our goods are more competitive when we can sell them without a tariff.

So it does benefit us on trade, but it is about more than that. It’s actually about our reliability as a partner. It’s about a strategic relationship. Panama geographically is a global crossroads, but politically it’s also been a very important bridge builder throughout the hemisphere. And it’s in our interest to have this partner be strong and stable and democratic, and the free trade agreement encourages openness and transparency and accountability – all the kinds of things that actually encourage Panama on its journey to first world status and make it a better and more stable and a more effective partner for us in the region. So I remain really hopeful that that free trade agreement gets passed as soon as possible because it’s just hugely in the U.S. interest to see that happen.

QUESTION: Ambassador Stephenson, that was one of the messages that was conveyed here today at the U.S. Chamber, which brought together the U.S. ambassadors from the Western Hemisphere region. What does this gathering mean? What message does it send?

AMBASSADOR STEPHENSON: Well, I think it was great to be here with U.S. business because the U.S. – Latin America is important to U.S. businesses. I mean, the U.S. is the largest provider of goods to most countries in this region, and our businesses – many of the companies that are represented in the Chamber have operations in our countries. And this is a – it’s a crucial part of this relationship, and I was really – I was glad to have an opportunity to talk in this forum.

QUESTION: That’s great. One final, quick question. I understand that your very first assignment as a Foreign Service officer was in Panama.

AMBASSADOR STEPHENSON: It was.

QUESTION: Now you’re serving as the U.S. Ambassador to this country. How have you seen it change, and what does this mean, you know, kind of having your career come full circle?

AMBASSADOR STEPHENSON: That’s right. Yeah, I think this is as much – is as close as a Foreign Service career comes to being a dream come true. My husband and I went down to Panama as newlyweds in 1986, and we’ve come back now, all these years later, with two children, one of them almost grown, and we’ve seen a country that’s grown also. I mean, the most spectacular thing that greets you is that on the way in from the airport you see almost Hong Kong rise up out of the Pacific Ocean there. I mean, the growth in shiny high rises is the most visible indication of the change that’s happened in Panama.

When I was there before, we spent most of our time in the economic section – I was an economic officer – to begin rescheduling Panama’s debt. It was about the most indebted country per capita in the world. And when I came back, it was a country that had just experienced 11.5 percent growth the year before, which was, if not the highest in the world, one of the very highest. And even this year, with global downturn going on around them, Panama turned in a 9.5 percent growth rate in the first semester. So it’s spectacularly prosperous.

The other thing, though, that’s less visible but is more fundamental is the change in government. It was a military dictatorship when I was there before, and there was repression and arrests, and there were beatings and there was closing down of La Prensa and the free press. And what we have now is a vibrant press and we have a democratic process that has produced four peaceful changes of government, and citizens have every expectation that the leaders, from the president down to every seat in the assembly that will be elected on May 3rd, they’ll all take their offices and they’ll all serve out their full term. And that’s, despite some of the weaknesses that remain in these fledgling democratic institutions, that is a profound, profound shift.